crude weekly insights – Fuel oil markets – FO LDO price trend in India
Crude flat prices closed high on the weekend. Both the benchmarks prices whipsawed as investors grappled with a spate of reports over the imminent SoH deal during the week. Markets opened low and bottomed in the early week over Trump pausing attacks over Iran oil infra. Markets shifted focus to inventory data, Escalation of rift in ME, Eastern Europe and lack of progress at SoH that drived oil prices up during the mid week.
Timespreads demonstrated flat to weaker trends alongside benchmarks. Price structure continues to sport strong backwardation structure due to indicators of easing tightness of physical markets as against mini glut induced contango during recent days.
Inventories data was mixed over modest draws in ARA Europe and modest builds across the US and SG. Stocks across all major ports are running below five years average.
Refined products prices continued to rally. Both the road transportation fuels in the US showed record high crack spreads for this time of year after roll over. Russia continued to scramble for fuel supplies after the Ukraine assault on Russian refining.
Market Positioning data showed that speculators flipped to net sellers of crude Futures and options during the week ending on 4th Aug, 2026. Money managers reduced their net length with longs exit while shorts built up positions in both benchmarks.
FUEL OIL MARKETS
Fuel oil markets in Asia at the Singapore trading window changed moderately during the week. The Singapore fuel oil markets ended the week with a bullish bias in HSFO but a more balanced/neutral bias in VLSFO.
On the technical side, HSFO witnessed a classic mid-week correction followed by a strong Friday recovery $557 was the short term support with $584 as resistance. On the inventory side, Singapore residual fuel oil stocks averaged 19.58 Mb in Aug so far, about 610,000 barrels higher than July and approx 3% higher MoM.
Turning to VLSFO, Kpler reported that SG 0.5% fuel oil structure had tightened considerably with prompt inter-month spreads and cash diff rising during July bcz of constrained low-sulphur blending components and limited suitable crude availability. VLSFO-HSFO spread was very strong.
Putting some light on Indian product markets, Furnace oil (FO) prices are likely to revise down moderately while LDO prices are trended up due to low middle-distillate stocks at SG. MTO price trend is stable to mildly bullish. Bitumen prices likely to be flat for the 2H26.Singapore fuel-oil inventories before the July pricing window closes.
